Grayling's first half revenues have slid by 7.2% to £40.4 million, contributing to a 0.5% like-for-like drop in parent company Huntsworth's top line.

Peter Chadlington: 'We believe that we are on track to meet full year management expectations'

The multidisciplinary network, which accounts for nearly half of the group's revenues, encountered client budget reductions in difficult markets in the UK and Europe.

Huntsworth recorded group revenues of £88.9 million for the six months to 30 June, up slightly from £88.2 million a year ago, though down 0.5% on a like-for-like basis.

Like-for-like revenues were flat for its financial PR operation Citigate, at £12.1 million, and its UK consumer agency The Red Consultancy, at £6.9 million.

However, Huntsworth Health put in a strong performance with like-for-like revenue growth of 9.7% to £29.5 million.

Lord Chadlington, chief executive of Huntsworth, said: 'Citigate, Red and Huntsworth Health are all performing well. Grayling, under new leadership, is beginning to see the benefits of the investment plan announced in April to stimulate top line growth and capitalise on the growth of digital revenues. We believe that we are on track to meet full year management expectations.'

The latest news on Huntsworth's proposed sale of a 19.8% stake to Chinese PR and marketing group BlueFocus is that the £36.5 million payment is expected next month.

BlueFocus has received approval for the subscription from China's National Development and Reform Commission.